Once they’re satisfied with that, then they sign a few documents and we issue them shares and then that’s it - you’re away.” “An investor will say, ‘Yep, I’m interested,’ and then they will go through an amount of due diligence, which is a process where they ask us a bunch of questions to get clarity around our business so that they can see that what we’re promising stacks up with who we are and what we’re doing. We now go to the occasional pitching event, where there are a group of investors in the room and we pitch to them all at once. And you just keep going through that process and talking people through the pitch deck. As you grow you go to your existing investors first and you see if they’re interested, and if they can introduce you to anyone else, other investors. Once we’ve got those things together, then we start making phone calls, and in the early days you’re going out into the big bad world with no one on your side.
![recordit startup recordit startup](https://mac-cdn.softpedia.com/screenshots/Recordit_5.png)
Then we create what’s called a pitch deck, which is a powerpoint presentation that steps through the investment opportunity. The next step is we prepare an investment teaser, which describes who we are as a business, what we’re trying to achieve, how much money we’re trying to raise, what the opportunity is for an investor - and that helps to distill our thinking about the investment itself. That requires a bit of forecasting, budgeting - the dry, boring stuff. So what we do is we sit down and figure out how much money we need in the investment round. “Well, I can tell you the process that we followed, but I don’t know if that’s ‘the process’ or best practice. But it’s fun - having those networks, knowing that you can get an introduction to someone easily, makes it fun.” Invariably, people are investing smaller amounts of money, and invariably people will already know you, your family, or your friends, so that adds a layer of complexity and consideration that I think is not present elsewhere in the world. So that’s good, but it’s also quite difficult because there’s not nearly as much money in the early stage investment market in New Zealand as there is elsewhere. Once you’ve found one, you will meet others, because they all tend to know each other - their community is quite small. It’s very easy to get in front of potential investors - it’s very easy to find them. “Capital raising in New Zealand is quite different to how it works in other countries, and that comes from the fact that New Zealand is so small.
![recordit startup recordit startup](https://startup.lemonture.com/wp-content/uploads/2015/06/Wunderlist.jpg)
What is it like, capital raising in New Zealand? In this episode of the Startup to Scale Up series, we talk to Parkable CEO Toby Littin about his experience capital raising for a business in its infancy, and how drastically different the capital raise is now, nearly three years down the track. Many people who are starting their own business will require outside investment, and that means going through a (possibly daunting) capital raise process.